PC Air sues Koreans for B1.5bn

PC Air, the privately owned Thai charter airline, has sued two South Korean business partners for 1.5 billion baht in compensation for damage to its reputation over a row which left 400 Thais stranded at Incheon International Airport in October last year.

The company had filed a complaint with local police in Incheon city against its South Korean sales agent, Skyjet, and oil company Jae Sin. Police were preparing to forward the case to prosecutors, PC Air’s chief executive Peter Chan told a press conference on Thursday.

PC Air accused the two companies of committing a financial crime by blackmailing it into paying them money through holding its passengers hostage.

PC Air, billed as the world's first to employ the third gender as cabin attendants, had its sole aircraft, an Airbus 310-222 with 200 seats, refused permission for take-off from South Korea’s biggest airport. In earlier reports, the refusal was said to have been triggered by a financial conflict between PC Air and its South Korean sales agent, Skyjet, over unpaid bills for airport charges and jet fuel, reportedly amounting to more than 10 million baht.

According to Mr Chan, PC Air paid US$160,000 to Skyjet to settle fuel bills on Oct 11 and had documentary evidence to back up its claim. On Oct 15, the company allegedly received a letter from Jae Sin which asked it to pay an additional US$600,000 and authorise Skyjet to operate as PC Air’s sales agent in Thailand, otherwise the airline would be refused the right to use the airport.        

The company refused to pay the requested sum because Jae Sin did not specify clearly what purpose the extra money was needed for, Mr Chan said.   

The refusal resulted in Skyjet closing its counter service and Jae Sin refusing to refill the airline’s aircraft, leaving Thai passengers  stranded for 25 hours.

The 1.5 billion baht compensation claim was for damage to PC Air’s reputation, lost revenue after it was advised by the Department of Civil Aviation to suspend flights until it resolved problems related to unpaid bills and compensation payments for stranded passengers.         

Thursday’s press conference was held after PC Air spent the last three months collecting evidence and tracking bank account movements of its South Korean partners in which it claimed to have discovered that Skyjet did not settle fuel bills until Oct 19, although the payment was made on Oct 11. And this caused the subsequent damage, Mr Chan said.             

PC air is in the process of terminating its contracts with Skyjet and Jae Sin, Mr Chan said, and is expected to resume normal operations in the next 30 days. The airline now has a licence granted by the Department of Civil Aviation, he added.  

The PC Air chief executive said he wanted this issue to be a case study for other future private charter airlines so that they can be cautious and assured that they are doing business with honest companies only. 


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Writer: Amornrat Mahitthirook
Position: Reporter